DISCLAIMER: Sound Property Group accepts no responsibility for the accuracy of data entered into the Sound Property Cashflow Calculator, and its subsequent estimates. Results are not financial advice and are a general guide only. Always consult a qualified and licensed accountant or financial professional before making any decisions to invest. Please refer to the full disclaimer before using Sound Property Cashflow Calculator.
Designed to give a quick estimate of the net operating in the first year of ownership. The Sound Property Cashflow Calculator combines the rental revenue and operating expenses of the property, with the percentage of income tax paid, to measure the net change in the investor’s weekly and annual income.
The Sound Property Cashflow Calculator has been designed in four steps broken down below. The steps are designed to work through in order however can be navigated backwards to change any input. There are various help features throughout the calculator symbolised – (?). For a full introduction and instructional video, please refer to this article.
This step captures the capital related costs of the property such as the purchase price, deposit and other initial costs. It calculates the stamp duty payable based on the Suburb + State entered. The user also has the ability to select ‘Cash’ or ‘Equity’ for the purchase costs if they are borrowing equity from another property. If ‘Equity’ is selected, the calculator will apply an interest charge to all purchase costs in the calculation.
This step requires the weekly income (rent) and various yearly expenses to be entered. Also, in this step are any interest or principal repayments based on whether the loan is ‘Interest Only’ or ‘Principal & Interest’. With ‘Principal & Interest’, the loan amount is repaid over a selected loan term. ‘Interest Only’ loans don’t pay down any of the loan, however will result in a better overall cashflow position as no principal repayment is made.
This step captures the yearly income or salary of the user and calculates the applicable ATO marginal tax rate. It also estimates the depreciation amount, or the tax deduction for the wear and tear over time on the property. The depreciation calculation comes courtesy of Washington Brown Quantity Surveyors.
The final step of the calculator reveals the first-year results of the data entered. These calculations show the relationship between the property’s rental income and expenses, with and without tax implications (i.e. post-tax and pre-tax). The results are displayed in weekly and annual amounts. This step also includes an equity growth table where the user can enter a chosen average capital growth figure and see what the compounding effect of this growth is over a 10-year period. It also shows the remaining loan balance and subsequent equity the user may accumulate over this time.
DISCLAIMER: Sound Property Group accepts no responsibility for the accuracy of data entered into the Sound Property Cashflow Calculator, and its subsequent estimates. Results are not financial advice and are a general guide only. Always consult a qualified and licensed accountant or financial professional before making any decisions to invest. Please refer to the full disclaimer before using Sound Property Cashflow Calculator.
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